Legislative fix offered for skyrocketing flood insurance rates

flood photoA Long Island home is rebuilt after Superstorm Sandy (staff photo)

Jamie Gregory, deputy chief lobbyist for the National Association of Realtors, says Congress could take action to address rising flood insurance rates that have shocked homeowners in coastal states.

Speaking to the Pennsylvania Association of Realtors recently, Gregory said the Flood Insurance Market Parity and Modernization Act, passed in the House, would clarify that property owners may satisfy the mandatory flood insurance purchase with either a NFIP policy or private insurance, ensure that consumers can move freely between NFIP and private insurance coverage without penalty, preserve NFIP as a viable choice and maintain important consumer disclosures.

“This is not a silver bullet to solve the problem of increasing flood insurance rates but it is a first step to move private insurance into the market to determine if it will work,” Gregory said.

Other Washington issues that could affect Realtors nationwide include tax reform, housing finance reform of Fannie Mae and Freddie Mac and the reauthorization of the National Flood Insurance Program, which expires in September of 2017.

“Tax reform may not be comprehensive but we need to watch possible changes,” Gregory said.

Other legislation Gregory is tracking include the “Risk Management and Homeownership Stability Act,” which would prohibit the use of guarantee fees, also known as G-fees, from being extended, increased and diverted for unrelated government spending.

The bill is a direct result of Congress’ action last year to allow the fees to be shifted to fund transportation spending.

Gregory says NAR will also fight to maintain the mortgage interest deduction for second homes, which he said affects a large number of real estate markets.

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